What: Bottega Veneta highlights the durability and craftsmanship of its bags through the launch of an unlimited maintenance service offer.

Why it is important: Customers who purchase iconic bags from Bottega Veneta boutiques will receive a certificate of craftsmanship in the form of a physical card associated with the serial number of the product, thus, providing free access to an unlimited number of refreshments and repairs.

Starting from mid-November, the service will begin with its iconic bags and extend later to all bags and other product categories.

Bottega Veneta launches lifelong warranty service

What: Macy’s Inc. will move into India through a partnership with local distributor Myntra in which the US department store’s private label brand portfolio will be sold online via Myntra’s multi-brand platform.

Why it is important: 600 options from Macy’s private label brands will be available on Myntra’s online platform.

Around 40% of Indian consumers typically purchase clothing and footwear from foreign or global multinational brands, which is higher among 25-34-year-olds (49%) and 35-44-year-olds (45%). Consumers also have a growing inclination to shop for clothing and footwear online with around one in five Indian consumers purchasing products through e-commerce platforms.

The partnership supports both companies by offering Macy’s an opportunity to attract a wide range of customer segments and Myntra the possibility to consolidate its international brand offering.

Macy’s enters Indian market through Myntra partnership

What: Customers are increasingly preferring in-person returns at a store over mail-in ones.

Why it is important: Mail-in returns are expensive and dent profitability, and should the market be shifting thanks to new customer preferences this could be a way for department stores to reduce the hit on margin. The NRF expects that this could help reduce the return costs by 40%.

Forbes reports that shoppers are increasingly making buying decisions according to return policies, especially when it comes to online buying.

In-person, box-free returns are now the favourite method according to customers, while mail-in returns are ranked in the 4th position. This is due to a fatigue related to the need of printing a label, finding packaging material and going to a shipping station. As a consequence, 54% prefer simply going to the store over 21% favouring in-mail returns.

Returns represented 16,6% of total retail sales in the US in 2021, with online returns at 21%.

Hassle-free returns are more important than ever 

What: Peek & Cloppenburg celebrated the opening of its renovated sales outlet in Zurich’s Sihlcity shopping centre.

Why it is important: The reopening of the renovated 4,100 square metre shopping centre included live music, textile customization, drinks and promotions.

The fashion retailer takes up three floors with the ground floor housing casual styles for men, women’s wear on the first floor and formal and business attire on the second floor alongside a 400 square metre cocktail department.

Peek & Cloppenburg opens in Zurich

What: The group delivers USD5 billion in gross merchandise value in fiscal year 2022, demonstrating strength of integrated luxury retail model.

Why it is important: Neiman Marcus delivered year-over-year meaningful gross margin expansion supported by healthy 80% full price selling. Sales are up 30% versus the previous year and USD495 million in adjusted EBITDA (11% EBITDA margin).

Top customers are highly loyal and drove 40% of total sales in fiscal year 2022. Top 2% of customers drive approximately 40% of total sales. 80% of top customers have at least USD1 million of net worth. Their average spend is over USD25,000 annually.

The company's new loyal customers tend to be younger, spanning from Gen X to Gen Z, as younger customers entered the luxury market during the pandemic. They migrate up the engagement spectrum, reflecting growing incomes and desire for luxury.

Neiman Marcus 2022 results

What: RSR questions the relevance of Black Friday in the digital age

Why it is important: Many IADS members keep on combining Black Friday (and other “institutional” sales dates) with their own labelled-sales campaign. Maybe it is time to review the efficiency of such institutional dates and trade them for more CSR clout?

RSR is arguing that Black Friday is a tradition from the past, which has been made outdated by customers’ behavior changes, the Covid-19 pandemic, and more importantly, the way retailers have acted on the US market, by starting deals and sales way ahead of the date of Black Friday itself. With the rise of online retail, there is no more point for customers to queue up outside early morning to snag deals that they could get from their home. In addition, Black Friday is now competing with retailers’ own labelled sales, Target’s Deal Days or Amazon’s Prime Days.

US retailer REI is going a step ahead and decides to give Black Friday as a day off to its employees, ‘forever’, instead of opening stores and trying to lure in customers. RSR remarks that this move is not so much about saying goodbye to a worn-out practice as it is another indicator that retailers are looking to be, or look, virtuous. In REI’s case, this means showing care to its employees, and RSR bets that this will strike a bell to Millenial and GenZ customers who are increasingly asking retailers to be good citizens.

Is Black Friday still relevant? 

What: Comparing the economic performance of German, Scandinavian, Benelux and US brands, McKinsey reports on the pessimistic view of German brand companies.

Why it is important: While rising energy costs, supply chain challenges and an unfavourable consumer climate are affecting most companies, German brands remain the most positive about the competitive advantage of their brand (80%) compared with the other countries surveyed (approx 30%).

However, only 3% of German brand companies rate their situation as very good at best, and 39% reported that their situation was good. The contrast is apparent when considering that 28% of Benelux and Scandinavian brand companies and 26% of companies in the US rated their current situation as very good.

German brand economy struggles according to McKinsey

What: Falabella’s department store chief has reported that the Chilean retailer may close between 5% and 10% of its department stores in Peru, Colombia and Chile.

Why it is important: While the closures have not been finalized, the announcement is part of a constant evaluation of the profitability and changing consumer demands of Falabella.

Falabella may close 10% of stores this year

What: Boston Consulting Group and Vestiaire Collective report the impact of the secondhand fashion and luxury market.

Why it is important: BCG and Vestiaire Collective estimate the value of the apparel, footwear and accessories resale market is between 100 and 120 billion dollars worldwide which is triple the size it was in 2020.

The report further states that the secondhand market is already worth 3 to 5% of the overall apparel sector which could grow to as much as 40%.

Resale market tripled in two years

What: The virtual store has an open format allowing customers to browse and explore the fantasy land created to house digitally modelled products.

Why it is important: Printemps is offering visitors who purchase a product from the immersive store a chance to enter a prize draw to win one of 30 NFTs created in collaboration with the artist Romain Froquet.

Those who receive an NFT will also give the holder the ability to receive the original painting by Froquet, exhibited in the atrium of Printemps Haussmann during the campaign.

Printemps opens virtual store in the metaverse

What: “Make the Moment” is the theme for Neiman Marcus’ holiday campaign.

Why it is important: Neiman Marcus will also launch a ski category in select stores along with its 360-degree campaign encompassing advertising, in-store visuals, special events, social media, digital content, video, email and the group’s popular Christmas Book catalogue.

The front of the Christmas Book includes augmented reality to place your face on the cover of the catalogue or virtually present the Neiman Marcus Christmas tree in your home or office. It features 260 luxury fashion and accessories brands. The products range from holiday decorations to fantasy gifts in the seven-figure price range. It continues to follow the new positioning of “Live Your Luxury” by taking the traditional Christmas tropes and twisting them in unconventional ways to show greater inclusivity.

Neiman Marcus’ Christmas campaign

What: Apple continues its foray into personal finance services with a new savings account opened in partnership with Goldman Sachs.

Why it is important: Credit card programs are not new for retailers, however Apple is becoming a significant challenge as their offering arrives in complement to a whole ecosystem allowing them to track and trace every customer move before, during and after the purchase, which is something most department stores can not do. In addition, they will be increasingly forced to team up with Apple, therefore abandoning access to the data.

Apple has teamed up with Goldman Sachs to propose a no-fee, high-yield saving account for its credit card customers, as a natural follow-up of its 8-years old initiative which started with Apple Pay.

This new saving account will complement the already existing perks of the Apple credit card (1% daily cash rewards), which was launched in 2019 and for now is only available in the US.

Apple financial services are part of the general services unit, which posted a 12% growth last quarter to $19.6bn.

Apple launches a high-yield saving account

What: Despite inflation, earthquakes, and global tensions, Mexican customers continue to shop amid new store and mall openings.

Why it is important: Following relaxed health restrictions and the end of lockdowns, Mexican consumers have increased their shopping in-store. Malls continue to open at an increased pace with forecasts for 30 new locations by 2025.

El Palacio de Hierro recently opened an opulent location even after having suffered damages from the recent earthquakes one week before opening. They continue to see strong demand like Liverpool and Suburbia.

Boutiques selling men’s tailored fashion on the other hand are struggling as consumers’ buying habits move towards casual looks and international brands. Still, Mexican designer brands such as Benito Santos are performing strongly. Concept stores are also popping up in trendy quarters such as La Roma or in La Juarez, giving a chance to young talent to showcase their work.

Unfortunately, such buoyant sales are unlikely to last as a large portion of the country’s population remains poor or is living in extreme poverty. Inflation in Mexico is running at 8.7%.

Mexican retail booms

What: The German company has already received €680mn in the past two years from the German state.

Why it is important: We unfortunately need to be prepared to more news like this as we live in a time of continuous crises. However, in the case of Galeria, the group needs to accelerate harder on its transition, probably at the cost of closing a number of stores.

The German department store chain Galeria Kardstadt Kaufhof has been impacted, like other players in Europe, by the war in Ukraine, energy crisis and low consumer confidence, which leads to unplanned additional spending (€115mn in the next 2 years for energy alone). As a consequence, the company has to apply for German state aid for the third time, after having already received €680mn in the past two years.

This raises some criticism from experts, who lament that the optimisation of the group (with the merger of Kardstadt and Kaufhof) has not been fully finished, and the store fleet is still too large, with 131 stores in Germany.

The group also owns Inno in Belgium.

Galeria Kardstadt Kaufhof is applying for state aid for the third time 

What: Lotte, Shinsegae, Hyundai and other department stores are opening special stores for used items and investing in online second-hand marketplace apps to attract younger customers.

Why it is important: Korean department stores used to deal with up-to-date and pricey merchandise to differentiate from other retailers. Due to young customers' increasing demand for used items, they now must differentiate in new ways.

Hyundai in Sinchon (Seoul), has turned its whole fourth floor into a second-hand marketplace, opening various stores selling used clothes and luxury watches and handbags.

BGZT Lab, an offline store from popular resale marketplace app Bungaejangter, saw 400,000 visitors last month at Hyundai Yeouido.

In January 2022, Shinsegae Group invested USD57.17 million in Bungaejangter. In August, the company collaborated with Bungaejanger to open BGZT Collection, its luxury goods store, in the retailer's online shopping mall SSG.com.

On their side, Lotte in Busan also opened a second-hand pop-up store to sell clothes from both domestic and international brands at discounts of up to 70%.

Korean department stores enter second-hand

What: Deals are starting early with Nordstrom and Nordstrom Rack with services, including gift wrapping, free gift help from stylists, and same-day or next-day order pickup.

Why it is important: Nordstrom has released a celebrity-backed campaign, announced in-store and online events, and refreshed its Balsam Hill Christmas tree lot offer at select stores, among other events and services for shoppers this holiday season.

The department store also plans to hire 20,000 employees across Nordstrom and Nordstrom Rack stores, supply chain facilities and customer support staff in order to execute its in-store and online goals.

Nordstrom boosts pre-holiday events and services

What: Frasers Newbridge is the latest investment for the group in its quest to expand across Europe.

Why it is important: Following the opening of Frasers Wolverhampton in 2021, along with renovations of standing locations, the recent opening of the Frasers Newbridge store is the first of three stores planned to open late this year.

The group remains committed to expanding across Europe by creating shopping destinations focused on experience, brands and services.

Frasers debuts signature flagship in the Republic of Ireland

What: John Lewis’ director spoke at the Bloomberg Equality Summit, expressing the highly uncertain outlook for the retailer’s performance for the end of 2022.

Why it is important: The high staff levels and employee-owned structure of the retail group are likely to make soaring inflation more impactful than the Covid-19 pandemic according to the John Lewis Partnership boss.

The cost-of-living crisis has intensely impacted consumer discretionary spending, with the retailer reporting a 99-million-pound loss for the first half of 2022.

John Lewis boss shares concerns on the effects of inflation

What: Marks & Spencer is heavily reviewing its real estate footprint.

Why it is important: Marks & Spencer’s move away away from city centre locations into easier-to-access stores that include bigger plots with free parking will likely reverse the vision of retailers in the UK and US.

Marks & Spencer is halfway through a costly plan to modernise its stores by 2028. The eventual bill will be more than GBP1bn, but the 138-year-old chain insists the strategy is starting to pay off. At a recent investor presentation, M&S cited a 30 % rise in clothing sales and a 75% increase in food since it shut a store in the centre of the Welsh town Llandudno and opened a new one in a retail park.

M&S wants to become a destination for large weekly shops rather than “top-ups” of treats and ready meals. To do that it needs large, open-plan stores with easy access and free parking, and fewer odd-shaped sites in town centres with limited access.

Marks & Spencer seeks out-of-town real estate 

What: The Tokyo department store located in Shinjuku has closed amid a comprehensive redevelopment project around the Shinjuku station.

Why it is important: Odakyu will continue selling goods in a building nearby.

Many visitors took photos and thanked staff as the building will be demolished following 55 years of operation. The moment is bittersweet for residents who have grown up with the landmark shopping mall.

Following the demolition, other department stores alongside Odakyu will be rebuilt. A pedestrian deck connecting the station’s east and west gates is also planned. In place of the former Odakyu building, a 260-meter, 48-story complex with offices and shops is to be built in 2029.

Odakyu Department Store closes for redevelopment

What: Made.com falls victim to post-pandemic optimism.

Why it is important: Made.com’s DTC and digital native advantages were short-lived as consumer habits changed post-covid leading to the brand about to go bankrupt after only going public in June of 2021.

The recent macroeconomic environment has caused freight costs to rise roughly fivefold between 2019 and 2022. Being digitally native at a time when consumers are returning to brick-and-mortar stores has counteracted their initial asset-light, vertically integrated business model.

Its decline is a reminder of the dangers of assuming both that Made.com’s millennial market was exceptional and that high demand during the pandemic was not.

Made.com bursts apart at the seams

What: New regulations are coming into force in Europe which will change the way that businesses operate and how startups will be financed and grown.

Why it is important: It is becoming more challenging for businesses operating in the EU to be able to comply with the various regulations that are being enforced. Startups have the opportunity to implement such regulations at the core of their businesses, but veteran companies will need to pivot to ensure compliance.

EU’s Sustainable Finance Disclosure Regulation (SFDR) came into force last year regulating disclosures of investee companies’ energy and water use, supply chains, waste systems and their gender pay gap, among other sustainability indicators. Further disclosure rules will come into effect on January 1, 2023, therefore the following steps should be considered in order to build a successful business model that will be sustainable over the long term.

1)    Make sustainability ingrained in the DNA of the business model

-    Regulations are cracking down on greenwashing claims, therefore companies need to make sure that all communication matches reality and does not mislead consumers.

2)    Track sustainability criteria and KPIs as soon as possible

-    These metrics need to go beyond environmental concerns and include social issues such as gender pay disparities and staff retention and should be captured as soon as possible.

3)    When choosing suppliers, have an ESG scorecard

-    Scope 3 emissions are part of SFDR’s reporting, therefore companies will need to understand their indirect impacts related to all suppliers, even outside of the EU.

4)    Appoint an ESG officer early

-    The C-suite needs to be involved and engaged in sustainability with an ESG advocate sitting at the top of the company.

How the changing ESG regulations in Europe will impact businesses

What: For the month of September, year-over-year, Spanish shopping centres saw visits increase by 10.2%.

Why it is important: According to the monthly index by Sensormatic Solutions, Spanish shopping centres grew in September following a 2.9% dip in August.

However, comparing this year with 2019, shopping centre visits decreased by 4.5%. The annual accumulated figure for 2022 is down 12.8% compared to 2019.

Spanish shopping centres grew 10.2% in September

What: Jane & Hall Associates’ latest investment research lays out Europe’s retail trends.

Why it is important: The firm reported that the most notable trend was weaker consumer spending in Europe compared to the US.

As well, there have been and continue to be a significant number of store openings and remodelling in London. Despite strong in-store assortments across apparel, accessories and footwear as well as tourism returning, the firm saw that consumer discretionary categories were hit harder in the US.

Jane & Hill Associates also expressed caution about brands with strong European presence such as Nike, Foot Locker, Abercrombie & Fitch, Levi’s, and VF Corp, among others.

Research shows weaker consumer spending in Europe